The 10-second takeaway
For the quarter ended March 31 (Q1), Cbeyond met expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue improved and GAAP earnings per share. The non-GAAP profit was a surprise, as analysts had predicted a loss.
Gross margins expanded, operating margins grew, net margins dropped.
Cbeyond logged revenue of $123.8 million. The one analyst polled by S&P Capital IQ expected sales of $124.0 million on the same basis. GAAP reported sales were 4.1% higher than the prior-year quarter's $119.0 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.01. The eight earnings estimates compiled by S&P Capital IQ averaged -$0.03 per share. GAAP EPS were -$0.04 for Q1 versus $0.00 per share for the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 67.3%, 60 basis points better than the prior-year quarter. Operating margin was -1.1%, 10 basis points better than the prior-year quarter. Net margin was -1.0%, 90 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $122.4 million. On the bottom line, the average EPS estimate is -$0.02.
Next year's average estimate for revenue is $491.3 million. The average EPS estimate is -$0.04.
The stock has a one-star rating (out of five) at Motley Fool CAPS, with 101 members out of 132 rating the stock outperform, and 31 members rating it underperform. Among 42 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 29 give Cbeyond a green thumbs-up, and 13 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Cbeyond is hold, with an average price target of $10.07.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.